How to Save for a Deposit on Your First Home by Following These 5 Tips

One of the biggest investments you will ever make is buying a home. It is also a very big purchase that takes some planning, searching and a whole lot of saving. If you think it is too much of an ambitious goal, you are in luck. With some dedication, planning, and perseverance, it might just be closer than you think.

If you have already seen your dream home, and you are thinking to yourself ‘how on earth am I ever going to afford this’, we’re here to set your mind at ease and provide you with practical tips on how to save up for a big deposit on your little haven. In this article, we discuss these saving tips to equip you with the knowledge and skills to enable you to reach your goal. Let’s get started.

If you don’t have a budget yet, now is a good time to put one in place. This way you will have a grip on where your money is going, and you will be able to see where exactly you can either cut down or spend more (if you have debts to take care of). You will also be able to identify how much you will be able to save towards your deposit. For some tips on how to draw up a budget, read our guide here.

2. Take Care of Debts

It is very important to be sure you will be able to afford the mortgage each month, if you have a lot of debt, this might set you back. Be sure to take care of all your debts before buying a house, this way you won’t risk losing everything if something goes wrong. A bonus when paying off your debts before applying for a home loan or mortgage is that your credit record will reflect that you are a reliable candidate.

3. Get a Second Income

If you have some debts to take care of as well this is a very good idea. Having a second income will enable you to reach your goal much faster, and ensure you are able to pay off your debts sooner as well. Putting in some extra hours after a day at the office will pay off as you will find that you are able to put all the extra cash away. Just be sure to check that you won’t run into any trouble at work with conflict of interest as some companies may prohibit employees to freelance.

Start preparing yourself for what your monthly expenses would be and how much you would have to pay off on your mortgage. Keep in mind that the bigger the deposit you put on the house, the smaller your installments will be, so the more you are able to save up in the time before you buy the house and pay the deposit, the better.

5. Ask Assistance

You never know, you might just be able to get some help from family members or friends. If you are able to borrow some money from someone you know, it is likely that you won’t be ridiculous interest rates. Another option to consider is applying for a grant.

If you stick to these tips, you should be well on your way to reaching your goal and having enough funds to put down for a deposit on your dream home. We hope that you found the information we shared helpful and that buying your house will be closer than the dream now.